Friday, May 27, 2011

1. Malaysia is blessed with a climate and soil that enables trees to take root and grow very fast. Our success in the plantation industry is due to this. The trees we grow, rubber, oil palm tree and cocoa are foreign to Malaysia yet they grow better here than in the countries of their origins.

2. However, the success of our plantation industry has totally affected out thinking. We know that by planting trees in perfect rows, with the trees separated from each other by a specific distance, we maximise the potential for growth and render the extraction of the latex or the fruits easier and more efficiently. We miss none of the trees when we tap rubber or bring down the fruits.

3. But forest trees do not grow in rows. They are scattered haphazardly. It is this which gives the forest their special appearance or character.

4. For various reasons we have to reaforest the forest we had raped. We also need to create new forests.

5. But because we are so addicted to planting trees in orderly rows, when we want to reaforest or to create a new forest, we plant the forest trees in the same way. Even when we plant teak and other trees on the road shoulders, they are planted in perfect rows. Our secondary man-made forests look nothing like forests at all. They look like tree estates.

6. But there are times when planting on the road sides, we want to create an avenue of trees. Then we should plant just one row of trees or palm trees perfectly aligned and separated. The tree should be the same all the way through. But when we want to recreate forests let the trees be scattered haphazardly like in the forest.

Saturday, May 14, 2011

1. The dollar i.e. the US dollar has been depreciating against the Ringgit. It is now hovering just below RM3.00 to 1 USD. Obviously this currency crisis is not over yet. Obviously the US is still in trouble. Europe is also in trouble and so is the rest of the world. This is the longest financial crisis in history. It is now in the fourth year.

2. This crisis started in the US in 2008 with the banks going bankrupt because the sub-prime loans defaulted and Lehman Brothers went bankrupt. Since then the US Government has been printing money by the trillions to bail out banks, insurance and automobile companies.

3. Currently Greece is still unable to repay loans caused by the switch to the Euro.

4. Malaysia appears to have escaped much of the crisis. Our currency is in fact getting stronger and our economy is growing at a good rate.

5. Why has a serious currency crisis affected the developed countries and not as much the developing countries? The answer is that we have not been trying to get rich quick through playing the money market.

6. I am not a financier of course and my knowledge about finance can be written on the back of a postage stamp. So no one should take what I say about finance seriously.

7. Still, I would like to hazard a theory.

8. The US was, after the Second World War, the richest nation. They have companies like General Motors, General Electric, Caterpillar Tractors, McDonnell Douglas & Boeing, great manufacturers of household appliances, radios and television, machine tools, precision instruments and of course a massive weapons industry.

9. They were so confident of the superiority of their industries that they did not mind teaching the Japanese the importance of quality and expertise in manufacturing.

10. To cut a long story short, the Japanese mastered manufacturing so well that their high quality but competitive products displaced those of the Americans and much of the Europeans in the world market.

11. After Japan came Taiwan, South Korea and then China. The products of these countries even displaced American and European products in their own countries. The last straw is the invasion of East-Asian cars into the American and European markets.

12. Instead of trying to compete, the Americans in particular, and the Europeans opted to surrender the markets to the Asian newcomers. But American and European economies continued to grow and they remain as prosperous as ever.

13. To remain ahead in wealth the Americans and Europeans invented a new market - the money market. They invented ways of making money from money. These they call products although they cannot be eaten or used.

14. The banking system they created was for the purpose of lending money to finance business enterprises. To do this the banks were allowed to lend more money than they have as capital, assets and deposits. In effect this means the banks could create money. In fact in the past banks issued banknotes to pay for goods and services. Later the banknotes were replaced by cheques. Everything can be paid with cheques. No cash is needed any more.

15. It was fine as long as the Government oversees the money created by the banks and limits it to ten times the banks assets. Then the American Government decided that it should not supervise the banks. The market would regulate itself.

16. Freed of Government oversight the banks began to lend far more than ten times their assets. They lent even to people with no income and no capacity to repay the loans, especially for houses.

17. The loans were then either mortgaged or insured. The belief was that they were safe. In any case if the borrower defaulted the property would be worth more than the loans as property prices seem to appreciate all the time.

19. Any of these things can give huge profits. For the astute players any of these things can make them millionaires or billionaires overnight, practically overnight.

20. The money market products yield nothing substantial. They create no jobs, no tangible products, no trade in goods or services, no spin-offs in terms of business, no transportation of goods by land, sea or air.

21. Yet the size of the transactions in monetary terms is mind-boggling. The trade in currencies is said to amount to four (4) trillion US dollars a day. It is the size of the total German productivity for a year. Yet no jobs are created, no goods or services are produced, no movement of anything is seen.

22. Of course the people involved in the trade make billions of dollars. Operating out of tax free havens, they report to no one and pay no tax.

23. The money market players and the billions they make contribute to the high GDP and the Per Capita incomes of America and Europe.

24. Then came the collapse. The bubble bursts. And there was nothing spilling from the burst bubbles.

25. The money market players know nothing about other business, about the production of goods and service, about real trade in these things. Actually all of them have become poor.

26. And so they resort to printing money, to remain rich. But the money they print is as valuable as toilet paper.

Saturday, May 7, 2011

1. It is great to watch Kuala Lumpur grow. We see everywhere the cranes marking the sites of new development. There are skyscrapers in every corner, great skyscrapers of fantastic shapes and heights. Kuala Lumpur now looks like other great cities of the world.

2. But if you look again you will see that it is still quite green, greener than most other cities. New landscaping with mature trees have contributed towards this greenness.

3. But there are here and there patches of forests, as dense as the well-known tropical forests of Malaysia. They are thick with undergrowth which make them as impenetrable. The trees are tall and so leafy that they cut off all the light of the sun in the day time. You cannot see through these miniature forests and I think you cannot walk through them either.

4. They make Kuala Lumpur truly green and at times you feel as if you are driving through a forest. How wonderful to be able to drive through forests right in the middle of the city. Then you emerge to see the towers of the skyscrapers, the shopping complexes and the manicured streets once again.

5. The experience is unique and it is characteristic of Kuala Lumpur, the capital of Malaysia.

6. Sadly I have seen these forest patches disappearing one after another to be replaced with hard concrete and granite towers of development. I fear in time, in not too long a time, the forests will all disappear. Their green will no longer colour Kuala Lumpur. They will no longer give shade to passers-by. The sunlight will be hard and hot, bouncing off tarred streets and concrete pavements and heating up the air above.

7. We need to develop. But we need to care also for the environment. The patches of forests of Kuala Lumpur are unique. We should try to preserve them even if it will cost us a lot of money.

Sunday, May 1, 2011

As posted by Dr. Mahathir Mohamad at Che Det on April 29, 2011 10:45 AM

1. What does the ordinary man imagine a no-fly zone is about? I believe he would imagine a sky without any planes flying. At most he would expect to see only military aircrafts of the enforcing nations flying over the zone to ensure the aircrafts of the targeted country are not flying over the zone.

2. In the case of the Iraqi no-fly zone, the enforcing nations apparently believed that "no-fly zone" is about blockading the zone to deprive it from receiving supplies of all kinds including food and medicine. As a result an estimated 500,000 Iraqi children were born deformed or were still-born due to the affect of bombs and shells with depleted uranium used in the Gulf War against Iraq.

3. Now once again a "no-fly zone" has been declared over Libya, this time by the United Nations. The Arab countries have also supported this resolution.

4. News reports now tell of bombs being dropped and targets being shelled by the Americans and their allies against Libyan forces and civilians. There is no report on Libyan aircrafts being shot down or chased out of Libyan airspace. Some reports claim that weapons have been supplied to rebels.

5. Are all these things included in the term "no-fly zone"? If they are were they stated in the resolution by the United Nations? Were the representatives of the Arab countries aware that this is the meaning of "no-fly zone".

6. If they were not stated and the Arab nations were not told, then why did the Americans and their allies take all these warlike actions.

7. It would seem that the United Nations needs to state carefully the meanings of the resolutions passed by its "organs". Otherwise the innocent members may be conned.